On June 12, 2017, the Supreme Court issued a unanimous decision in Sandoz Inc. v. Amgen Inc. (No. 15-1039), deciding that 42 U.S.C. § 262(l)(9)(C) sets forth the exclusive federal remedy for failing to provide a copy of the biosimilar application, and that 42 U.S.C. §262(l)(8)(A) permits a biosimilar applicant to provide 180-days premarketing notice “either before or after receiving FDA approval.” Although the Court left open the possibility that California state law might provide another remedy for Sandoz’s decision not to share its biosimilar application with Amgen and engage in the biosimilar patent dance, it seems unlikely that the Federal Circuit will find both that Sandoz’s decision was “unlawful” and that any additional state law remedies are not preempted by the Biologics Price Competition and Innovation Act (BPCIA).

The Biosimilar Patent Dance Issue

The Supreme Court “agree[d] with the Federal Circuit that an injunction under federal law is not available to enforce §262(l)(2)(A),” but for different reasons. In particular, the Court disagreed with the Federal Circuit’s reading of 35 U.S.C. §271(e)(2)(c)(ii) and the relevance of 35 U.S.C. §271(e)(4) to the issue at hand, and determined instead that 42 U.S.C. §262(l)(9)(C) is dispositive, and sets forth the exclusive federal remedy for failing to provide a copy of the biosimilar application. The Court reasoned:

The BPCIA’s carefully crafted and detailed enforcement scheme provides strong evidence that Congress did not intend to authorize other remedies that it simply forgot to incorporate expressly.”

42 U.S.C. §262(l)(9)(C) authorizes the reference product sponsor to bring a declaratory judgment action “for a declaration of infringement, validity, or enforceability of any patent that claims the biological product or a use of the biological product.” Thus, the Court’s decision means the only federal “remedy” available to the reference product sponsor when a biosimilar applicant fails to share its biosimilar application and engage in the patent dance is the option to bring an immediate declaratory judgment action.

As noted above, the Court did not rule out the possibility that an injunction might be available under state law. For that to be the case, Sanodz’s failure to follow 42 U.S.C. §262(l)(2)(A) would have to be “unlawful” under the Cali­fornia unfair competition law at issue, and any remedies available under that law must not be preempted by the BPCIA. The Supreme Court remanded to the Federal Circuit to consider these issues.

The Premarketing Notice Issue

On the premarketing notice issue, the Supreme Court reversed the Federal Circuit, finding that the statute only includes “a single timing requirement”—that the applicant give notice “at least 180 days prior to marketing its biosimilar”—while the Federal Circuit imposed two timing requirements—that the applicant give notice “after the FDA licenses the biosimilar and at least 180 days before the applicant markets the biosimilar.”

In view of its interpretation, the Court held that a biosimilar applicant “may provide notice either before or after receiving FDA approval.”

… But If We’re Wrong

Justice Breyer wrote a concurring opinion that invites the FDA to “depart from” or “modify” the Court’s decision if it “determines that a different interpretation would better serve the statute’s objectives.” (Now there’s a vote of confidence!) However, since the FDA does not administer or oversee the patent dance, it is not likely to issue any regulations or guidance on these issues.

What’s Next For Biosimilars?

The Court’s decisions on both issues give biosimilar applicants control over how—and when—patent disputes are addressed. A biosimilar applicant who wants to resolve them early could share its application at the outset, to force the reference product sponsor to bring suit at the culmination of the patent dance or face the limitations on remedies set forth in 35 U.S.C. § 271(e)(6)(B). A biosimilar applicant who wants to defer the patent issues could decide not to share its application, and perhaps challenge the patents in an inter partes review or post grant review proceeding at the Patent Office, where it could take advantage of the lower burden of proof for invalidity. While a reference product sponsor could bring suit without having been given a copy of the biosimilar application, originators may prefer to postpone litigation until the biosimilar product is closer to approval, when the possible infringement issues will be more certain, and when pending litigation could keep the biosimilar product off the market after approval.

As noted above, the Court’s decision on the premarketing notice issue will mean that biosimilar products can be marketed as soon as they are approved, as long as there are no preliminary injunctions stemming from any still-pending patent litigation. That possibility might encourage biosimilar applicants to participate in the patent dance, to increase the likelihood that all patent disputes will be resolved by the time the product is approved.

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